China and East TimorGood, but not best friendsIan Storey, The Jamestown Foundation, China Brief8/15/2006

Since the Democratic Republic of Timor-Leste (more commonly referred to as East Timor) achieved formal independence on May 20, 2002, the PRC has worked hard to cultivate a close relationship with the world’s youngest nation. China’s interests in East Timor are threefold: to expand its influence in the Southeast Asian region, to restrict Taiwan’s international space and to gain access to the country’s natural resources. Yet, the resignation on June 26 of East Timor’s Prime Minister Mari Alkatiri in the wake of several months of violence and the insertion of Australian-led peacekeepers to restore order highlights the limits to Beijing’s ambitions. The departure of Alkatiri, a strong supporter of closer links to the PRC, comes as a blow to China’s agenda. Moreover, Australia’s leading role in the peacekeeping force underscores its primary position in the hierarchy of East Timor’s foreign relations. While China is a good friend of East Timor, it is not, nor is it likely to become Dili’s closest friend.

The PRC played a cameo role in East Timor’s first bid for independence in the mid-1970s. When the Frente Revolucionária de Timor-Leste Independente (FRETILIN) Party declared outright independence from Portugal in November 1975, the PRC supported the declaration. Despite the almost non-existent links between FRETILIN and Beijing prior to the declaration, Indonesia used the PRC as a pretext to annex East Timor. Indonesia opposed East Timor’s independence on the grounds that it would encourage separatist sentiment in other parts of the archipelago and because Jakarta feared that East Timor might become a base for foreign subversion, particularly if the new government was communist [1]. This latter concern reflected President Soeharto’s anti-communist and anti-PRC prejudices. Under Operation Komodo—Jakarta’s clandestine plan to absorb the Portuguese colony—the Indonesian and East Timorese press carried fabricated reports alleging that PRC agents were orchestrating anti-Indonesian and pro-independence sentiment, that demonstrations were being financed by PRC money and that Beijing was providing arms and training to FRETILIN in preparation for a coup [2]. Under these pretenses, on December 7, 1975, Indonesia invaded East Timor.

Following Indonesia’s annexation of East Timor, the PRC acted as FRETILIN’s primary patron. China argued East Timor’s case at the UN, provided financial support to its government in exile in Mozambique and was prepared to furnish anti-Indonesian guerilla fighters with sufficient military equipment to arm a light division of approximately 8,000 troops. An interview with a senior East Timorese official revealed that due to a tight Indonesian naval blockade, however, China never attempted to ship the arms to East Timor [3]. Yet, China’s support for East Timor’s independence waned in the late 1970s. The cause seemed hopeless, and Beijing needed ASEAN’s and hence, Indonesia’s support to oppose Vietnam’s 1978 occupation of Cambodia. Nevertheless, China continued to vote in support of an annual resolution at the UN asserting East Timor’s right to self-determination.

When the people of East Timor voted overwhelmingly in favor of independence from Indonesia in August 1999, Beijing initially refrained from supporting an international intervention force to quell the rising violence. The Chinese government was concerned that such a force would set a dangerous precedent if a similar humanitarian crisis were to arise in Xinjiang, Tibet or even Taiwan; earlier in the year, Beijing had vigorously opposed NATO’s intervention in Kosovo on the grounds that neither the UN nor Belgrade had sanctioned it. Furthermore, China did not want to derail improving relations with post-Soeharto Indonesia by backing a force that was opposed by Jakarta. China gave its full backing to the International Force East Timor (INTERFET) only after Jakarta had asked the UN to intervene and the UN Security Council had sanctioned the operation. While China did not contribute personnel to INTERFET, it did dispatch a contingent of civilian police to INTERFET’s successor, the United Nations Transitional Authority in East Timor (UNTAET), only the second time the PRC had contributed to a UN peacekeeping operation (the first was for Cambodia in 1993).

At the stroke of midnight on May 20, 2002, East Timor became fully independent after three years under U.N. tutelage. The PRC became the first country to formally establish diplomatic relations with the world’s newest country. At the time, press reports speculated that Beijing had acted with haste in order to preempt Taiwan. Even before formal independence, however, the country’s “president-in-waiting,” Xanana Gusmão, had labeled China a “reliable friend” and had committed East Timor to a One China policy. Given China’s support in the mid-1970s, for Dili to have done otherwise would have been unthinkable. On receiving independence, China pledged US$6 million in reconstruction aid to East Timor, in addition to the $10 million in aid and grants that it had extended in 2000.

Where does the PRC fit into East Timor’s foreign policy? Dili has three foreign policy priorities [4]. The first is to establish cooperative and constructive relations with its two large neighbors Indonesia and Australia. With Jakarta, Dili has adopted a conciliatory policy that is forward looking and does not dwell on Indonesia’s brutal 24-year occupation. With regards to Australia, Dili looks to Canberra to help preserve its hard-won sovereignty. Australia played the lead role in INTERFET and since 1999, has been the primary provider of equipment and training for the Timor-Leste Defense Force. During the current political crisis, President Gusmão and Foreign Minister Jose Ramos Horta turned to Australia first, and Canberra responded quickly with 1,300 troops (Malaysia and New Zealand have provided smaller numbers of troops, and Portugal paramilitary police). Australia also plays a vital role in securing the fledgling country’s financial future. A 2005 agreement ensures that East Timor will gain access to significant reserves of oil and gas in the Timor Gap worth an estimated $15-20 billion. Dili’s second foreign policy objective is to obtain membership in international and regional organizations—upon receiving independence it immediately joined the UN, and it hopes to gain entry into ASEAN by 2010.

The country’s third priority is to establish comprehensive relations with a broad range of countries, particularly those with which it can forge strong economic ties. As Asia’s poorest country, economic growth is an urgent priority for East Timor. China, as Asia’s fastest growing economy, is obviously an attractive partner. In order to nurture commercial ties, East Timor has established an embassy in Beijing, one of only nine overseas diplomatic missions. East Timor and the PRC have signed a number of bilateral trade and aid agreements, including one granting most favored nation status to one another. Nonetheless, trade has been slow to develop, and in 2005, bilateral trade stood at a mere $1.7 million. Since 2002, China has tried to help East Timor in other ways. In December 2004, it provided $3.7 million in grant aid and in November 2005, a further $6.2 million. Yet, it is important to put this aid in perspective. In 2003-2004, the top four donors were Portugal ($34 million), Australia ($32 million), the United States ($25 million), and the European Union ($14 million) [5]. In contrast, China’s annual aid averaged around $6 million. Since 1999, Australia has provided East Timor with aid totaling $297 million and the EU (both member states and the European Commission) has provided East Timor with $827 million (half of the total funding) [6].

The PRC has also established a tentative military-to-military relationship with East Timor. China has donated non-lethal equipment to the East Timorese military (mainly uniforms, tents and other kinds of kit) and has paid for six officers to attend various training courses in the PRC. China’s military assistance to East Timor, however, is small in scale when compared to other donors such as Australia, Britain and Portugal.

As mentioned above, China’s primary interests are threefold. The first is to develop close ties with Dili as part of an on-going strategy of expanding Beijing’s influence in Southeast Asia while simultaneously lessening that of other powers, including the United States, Australia and Japan. Second, a close relationship with Dili limits Taiwan’s economic and political space in the region. Third, China is keen to exploit East Timor’s natural resources, especially oil and gas, but also copper, zinc and rare blue marble. Access to East Timor’s energy resources would provide China with an additional opportunity to diversify its sources of energy imports thereby enhancing the country’s energy security. A fourth, more-peripheral interest for China is that East Timor is a member of the Community of Portuguese Language Countries, which Beijing has been courting for a variety of reasons [7].

How successful has China been in advancing its interests in East Timor? Since 2002, Beijing has gained a strong foothold in the country. It has the largest diplomatic presence in the country and has financed construction of East Timor’s embassy in Beijing and the East Timorese foreign ministry building and presidential palace in Dili. China has also cultivated ties with East Timor’s leaders, partly through all-expenses-paid trips to the PRC. Former Prime Minister Alkatiri was East Timor’s chief advocate of closer ties to the PRC, and his resignation has therefore come as something of a blow to the Chinese leadership. China has, however, succeeded in keeping Taiwan’s profile to a minimum. In terms of gaining access to the country’s energy resources, one of China’s largest state-owned energy companies, PetroChina, financed a $1.6 million seismic study for oil and gas in the country’s interior. PetroChina is expected to bid to develop the field later this year. Onshore energy reserves are thought to be small in scale, however, and access to the real prize, offshore deposits, has already been won by Australian and other international companies.

The PRC looks to East Timor as a source of energy supplies and raw materials; politically, Beijing would like to leverage aid and economic ties to increase its political clout. Yet, there are definite limits to Beijing’s influence. The East Timorese leadership certainly appreciates Beijing’s support for the territory’s independence since 1975, though this does not equate to China occupying a privileged position in the country’s foreign policy. Moreover, East Timor’s foreign policy strongly emphasizes the importance of human rights and therefore, has more in common with Western countries than with the PRC. At the UN, for instance, East Timor votes more consistently with the US and EU countries than with China. In a revealing comment made in 2002 then Foreign Minister José Ramos Horta denied he had called the PRC East Timor’s “closest possible ally” in a media interview and that what he had really said was that Dili wanted to develop “the closest possible relationship with China.” He went on to state, “No two countries are more important to East Timor than our closest neighbors Australia and Indonesia” [8]. Therefore, for economic, political and historical reasons, it seems unlikely that China can ever displace Australia and Indonesia from the top hierarchy of East Timor’s foreign relations.